NextEra announces historic renewable plan

Source: By Kristi E. Swartz, E&E News reporter • Posted: Wednesday, January 27, 2021

NextEra Energy Inc., the world’s largest renewables developer, is expecting unprecedented growth under President Biden’s aggressive climate agenda that promises to speed up the nation’s shift to wind, solar and other low-carbon energy.

The White House’s laser focus on tackling climate change, combined with growing public pressure on companies to focus on environmental, social and corporate governance standards, will increase demand for renewables among NextEra’s traditional customers and open up new markets and business opportunities along the way, Jim Robo, NextEra Energy’s CEO, told Wall Street analysts on a call yesterday.

“We believe that the Biden administration, supported by a significant shift in public support toward taking action to address climate change, may act to further accelerate these shifts through the extension of existing incentives while [also] initiating other forms of policy support,” said Robo.

NextEra Energy Resources, the company’s competitive wholesale unit, has a backlog of 13,500 megawatts of signed renewable energy projects, including 2,000 MW added since October, its chief financial officer reported yesterday.

Because of the robust demand, the company has increased its projections by 3,500 MW to build up to 12,700 MW between now and next year. By 2024, it could add between 23 and 30 gigawatts to the nation’s power grid.

“This is by far the largest expected two-year development program in our history,” said Rebecca Kujawa, NextEra’s CFO.

Those projections arrive as Biden launches a whole-of-government approach to addressing climate change.

Transportation secretary nominee Pete Buttigieg is a key advocate in progressing Biden’s climate-friendly infrastructure bill and is an example of how carbon reduction will be present in all of the president’s policies (E&E Daily, Jan. 22). The Senate yesterday confirmed Antony Blinken to be secretary of State, allowing Biden to push his climate agenda internationally (Greenwire, Jan. 26).

The president wants to decarbonize the power sector by 2035.

Robo said he sees investment opportunities in the trillions of dollars for Florida-based NextEra.

The company is targeting the electricity, transportation and industrial sectors to further expand its footprint in traditional renewable fuels and emerging technologies such as battery storage, fuel cells and green hydrogen (Energywire, Aug. 14, 2019).

Executives on the call also announced more hydrogen energy pilot projects as well as a partnership to electrify school buses and public transportation vehicles across North America and Canada.

“We now believe that a substantial and economic decarbonization of the electricity, transportation and industrial sectors is possible,” said Robo.

Ramping up hydrogen, phasing out coal

Kujawa announced additional green hydrogen projects outside of the pilot project that NextEra’s Florida Power & Light Co. is developing (Energywire, July 27, 2020).

The first includes a 12-MW solar array, on-site hydrogen production and storage, and a hydrogen fuel cell. The project will use solar energy to create green hydrogen to power the fuel cell, which, in return, will send electricity to the local grid during peak demand, she said.

Green hydrogen is made from renewable electricity sources such as solar and wind power, rather than coal or methane. Electric companies are increasingly incorporating the technology to reach decarbonization goals.

Kujawa did not give other details, including where the project will be located. Pending regulatory approvals, construction is expected to start next year and finish in mid-2023.

NextEra Energy Resources also is in “advanced discussions” with several potential customers in the food processing, specialty chemicals and refineries fields to develop a more efficient green-production process, she said. This includes a project that combines a solar tracker with an electrolyzer at a large industrial plant. An electrolyzer is a system that uses electricity to break water into hydrogen and oxygen.

The project would deliver green hydrogen at an industrial feedstock facility, she said. When it’s not producing hydrogen, the solar power would offset a portion of the plant’s energy consumption, reducing carbon at its operations, she said.

“[NextEra Energy Resources] continues to develop first mover advantages with the first commercialization of an integrated solar-plus-hydrogen storage project,” analysts with Guggenheim Securities LLC said in a research note yesterday.

NextEra Energy Resources, First Student Inc. and First Transit Inc. also have agreed to electrify tens of thousands of school and public transportation vehicles across the United States and Canada. First Student is the largest operator of school buses in North American, with a fleet of 43,000, according to a NextEra news release.

This is the first year that NextEra’s regulated electric companies — FPL and Gulf Power Co. — will not have any operating coal plants in Florida. Michael Lapides, a utility analyst with Goldman Sachs Group Inc., asked about what other states that still are operating coal-fired power plants could learn from Florida.

Robo said there will be more pressure out of Washington for those states and utilities to shutter those coal plants. He referred to the Trump administration — and the former president’s vow to bring back coal — as “the opposite of federal pressure.”

Allowing coal plants to remain as part of a utility’s fleet costs customers additional money and amounts to a bad economic decision, he said.

“There is not a regulated coal plant in this country that is economic today, full period, end of stop, when it’s dispatched on any basis,” said Robo. “Not a single one.”